Noakes and anor v Adams and anor [2005] NSWIRComm 48 (14 March 2005)

Last Updated: 21 March 2005

NEW SOUTH WALES INDUSTRIAL RELATIONS COMMISSION

CITATION : Noakes and anor v Adams and anor [2005] NSWIRComm 48

FILE NUMBER(S): 1603

HEARING DATE(S): 18/02/2005

DECISION DATE: 14/03/2005

PARTIES:

FIRST APPLICANT

Paul Anthony Noakes

SECOND APPLICANT

Fiona Gai Noakes

FIRST RESPONDENT

Tony Adams

SECOND RESPONDENT

Ellen May Adams

JUDGMENT OF: Marks J

LEGAL REPRESENTATIVES

APPLICANTS

Mr R Alkadamani of counsel

Solicitor: Phil Hayward

Haywards Solicitors

RESPONDENTS

Mr M Jacobs QC with Mr P Bambagiotti of counsel

Solicitor: Kim Stapleton

JDK Legal

CASES CITED: Euphoric Pty Limited v Ryledar Pty Limited and Anor [2002] NSWIRComm 136

Majik Markets Pty Ltd v Brake and Service Centre Drummoyne Pty Ltd (1991) 28 NSWLR 443

Mayne Nickless Limited v Industrial Relations Commission of New South Wales [2004] NSWCA 359

Mitchforce v Industrial Relations Commission (2003) NSWCA 151

Mitchforce v Starkey (No 2) (2003) 130 IR 378

Noakes v Adams [2002] NSWIRComm 272

Production Spray Painting & Panel Beating v Newnham (1991) 27 NSWLR 644

QSR Limited v Industrial Relations Commission of New South Wales [2004] NSWCA 199

Solution 6 Holdings Limited v Industrial Relations Commission of New South Wales [2004] NSWCA 200

Sydney Water Corporation v Industrial Relations Commission of New South Wales [2004] NSWCA 436

LEGISLATION CITED: Industrial Relations Act 1996 ss 105 106

JUDGMENT:

- 1 -

INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

IN COURT SESSION

CORAM: MARKS J

Monday 14 March 2005

Matter No IRC 1603 of 2001

PAUL ANTHONY NOAKES AND ANOR v TONY ADAMS AND ANOR (No 2)

Application under s 106 of the Industrial Relations Act 1996

INTERLOCUTORY JUDGMENT

1 In these proceedings the applicants, Paul Anthony Noakes and Fiona Gai Noakes, have sought certain relief under s 106 of the Industrial Relations Act 1996 ("the Act") against the respondents, Tony Adams and Ellen May Adams. The summons by which the proceedings are currently constituted was the subject of a strike-out application brought by the respondents asserting that this Court lacked jurisdiction to deal with the proceedings. That strike-out application was dismissed in a judgment which I published on 23 October 2002 (Noakes v Adams [2002] NSWIRComm 272).

2 The applicants have now sought by motion to amend the summons. The respondents have, by motion, sought to resist the proposed amended summons on the basis that it does not disclose any cause of action within the jurisdiction of this Court. In essence, the jurisdictional arguments advanced by the respondents in connection with these interlocutory proceedings are similar, if not identical to, those advanced in the earlier proceedings. However, as will be seen, the state of the authorities is somewhat different by reference to recent decisions of the New South Wales Court of Appeal and a Full Bench of this Court. For this reason I propose to examine the matter afresh although some of the factual background, which I will shortly set out, will be repetitive of that contained within my earlier judgment.

3 The stage has been reached in these proceedings that all of the applicant's affidavit material has been filed. I have been directed to that material for the purpose of these interlocutory proceedings. Because they are interlocutory proceedings, I shall take the factual assertions made by the applicants as contained in the proposed amended summons at the highest in their favour, in accordance with well accepted principles applying to interlocutory matters of this kind.

4 In late November or early December 1998 the applicants became aware that a café/restaurant business known as "Troy's on Market" was available for sale by its proprietor, a Mr Baggett. The business was run from premises attached to the Woolpack Hotel in Mudgee, although they were detached from the hotel building and had a separate entrance. The applicant's were advised that the premises were owned by the respondents and that one of the respondents, Mr Tony Adams, was the licensee of the hotel. The applicants understood that Mr Baggett did not then currently operate the business under a lease from the respondents. There was an arrangement in place where Mr Baggett sold alcohol in the restaurant on behalf of Mr Adams.

5 Subsequently the applicants met with Mr Adams and were advised that a long-term lease would be provided and that profits from the sale of alcohol sold in the business would be dealt with in the lease. Mr Adams is also alleged to have told the applicants that he was keen to build a bistro area in the beer garden within the hotel premises, which would be serviced by the restaurant/café business.

6 On 5 December 1998 Mr Baggett signed a "letter of intent" to sell the business to the applicants conditional inter alia on the signing of a 12 month lease by them with Mr Adams. The handover date was said to be 1 January 1999.

7 Solicitors acting for the respondents forwarded a form of lease to solicitors acting for the applicants by letter dated 11 December 1998. The applicants' solicitor queried two of the terms of the lease but eventually they advised the respondents' solicitors that the amendments were no longer required. By letter dated 5 January 1999 the applicants' solicitors forwarded the lease document executed by them, together with the stamp duty, to the respondents' solicitor.

8 Meanwhile on 4 January 1999 the applicants had entered into an agreement to purchase the business from Mr Baggett. Completion date was said to be "on or about 31 December 1998". The applicants commenced working in the café/restaurant with Mr Baggett from 4 to 11 January 1999. After that time they operated the business in their own right.

9 By letter dated 18 February 1999 the respondents' solicitor wrote to the applicants' solicitors noting that a clause in the lease had been amended which was to be the subject of instructions from the respondents and also noting that the lease might require the consent of the Liquor Administration Board. The lease had been referred to a solicitor with expertise in licensing matters for this purpose.

10 Sometime in about March 1999 the parties became aware that the basis upon which alcohol was purchased by the applicants and sold by them in the restaurant was unlawful under the relevant legislation governing the sale of alcohol in licensed premises. This necessitated a change in those arrangements and, in effect, the applicants provided alcohol to patrons of the café/restaurant without any profit to them. This was the reason why the original lease arrangement did not proceed. Based on advice from a new solicitor, the respondents offered the applicants a catering agreement by which they could utilise the café/restaurant premises. This was rejected by the applicants, in part, because of conflicting advice they had received concerning the type of arrangement which would be regarded as lawful for the sale of alcohol in the premises.

11 Ultimately, the respondents did not proceed to install a bistro in the hotel which they operated from the premises.

12 In addition to operating the café/restaurant the applicants alleged that there were other responsibilities imposed on them as part of an arrangement made with Mr Adams. They were required to provide counter meals for sale to bar patrons at the hotel operated by the respondents to the specifications set by the respondents. They were also required to provide snacks to the hotel each Tuesday night to be consumed in conjunction with a dart competition and to provide hot finger food to the hotel every Friday afternoon. This was said to be a continuation of an arrangement which Mr Baggett had with the respondents. The respondents paid for the cost of ingredients but not for the cost of the preparation of these snacks.

13 The lease document contained certain provisions requiring the applicants to run a café/restaurant at the premises, to open at times usual for a business of a café/restaurant, to keep the property clean and dispose of waste properly and to maintain the property in its condition at the time of the lease, promptly undertaking any necessary repairs. The applicants were also required to maintain and decorate the shop front.

14 The controversy in these proceedings centred around a fundamental requirement for the exercise of jurisdiction and power by this Court under s 106 of the Act, namely that there be a relevant contract as defined "whereby a person performs work in an industry". It is convenient to set out the provisions of s 105 and 106 of the Act which are in the following terms:

105 Definitions

In this Part:

contract means any contract or arrangement, or any related condition or collateral arrangement, but does not include an industrial instrument.

unfair contract means a contract:

(a) that is unfair, harsh or unconscionable, or

(b) that is against the public interest, or

(c) that provides a total remuneration that is less than a person performing the work would receive as an employee performing the work, or

(d) that is designed to, or does, avoid the provisions of an industrial instrument.

106 Power of the Commission to declare contracts void or varied

(1) The Commission may make an order declaring wholly or partly void, or varying, any contract whereby a person performs work in any industry if the Commission finds that the contract is an unfair contract.

(2) The Commission may find that it was an unfair contract at the time it was entered into or that it subsequently became an unfair contract because of any conduct of the parties, any variation of the contract or any other reason.

(3) A contract may be declared wholly or partly void, or varied, either from the commencement of the contract or from some other time.

(4) In considering whether a contract is unfair because it is against the public interest, the matters to which the Commission is to have regard must include the effect that the contract, or a series of such contracts, has had, or may have, on any system of apprenticeship and other methods of providing a sufficient and trained labour force.

(5) In making an order under this section, the Commission may make such order as to the payment of money in connection with any contract declared wholly or partly void, or varied, as the Commission considers just in the circumstances of the case.

(6) In making an order under this section, the Commission must take into account whether or not the applicant (or person on behalf of whom the application is made) took any action to mitigate loss.

15 I shall shortly deal with the relevant authorities in this area but before doing so I will need to discuss in some little detail the factual circumstances by which the applicants asserted that there was in existence a contract such as would found jurisdiction under s 106.

16 The applicants asserted jurisdiction by reference to five matters which they said led directly to the performance of work in an industry. These were as follows:

Certain obligations imposed on the applicants by the lease document, which, although not executed, was said to govern the arrangement by which the applicants conducted the business from the premises.

17 These were requirements that the applicants use the property for the purpose of a café/restaurant, open the business at times usual for that type of business, keep the property clean and properly dispose of waste.

The sale of alcohol in the restaurant premises by the applicants on behalf of the first respondent.

18 Because of variations in the arrangements made from time to time in order to comply with the relevant legislation, an arrangement was ultimately put in place that the sale of alcohol to the patrons of the business operated by the respondents would be made by them on behalf of the licensee, Mr Tony Adams. This was said to create a situation whereby the respondents "were almost in the same position as staff of the hotel who simply sell alcohol to Mr Adams, collect the money and make no profit at all from the alcohol sales".

19 The contrary position put by the respondents was that the applicants were not obliged by any contract or arrangement with the respondents to sell alcohol. Taken at its highest, the evidentiary material was indicative that if the applicants wished to sell alcohol to patrons of the café/restaurant then there was a facility in place to enable them to acquire it through the license held by Mr Tony Adams.

The provision of counter meals.

20 In her affidavit, Mrs Noakes deposed to the fact that she had created a menu for counter lunches to be provided at the hotel which was approved by the respondents on the basis that none of the meals were priced in excess of $10. A menu for the counter lunches was displayed on a black board menu in a bar of the hotel, together with a "specials black board". Orders for the counter meals in the hotel were taken by staff employed by the respondents, who would then convey the orders to employees of the applicants who would then prepare the meals and deliver them to the hotel. Counter meals were supplied Monday to Saturday at lunchtime and on some occasional evenings. The proposed amended summons alleges that there was an arrangement between the applicants and the respondents in relation to the provision of counter meals to the hotel by which the applicants "were required to provide counter meals to patrons of the hotel ...". This connotes an obligation to provide counter meals, albeit one which might not be enforceable at law.

21 The respondents disputed that the evidence to which I have referred was capable of constituting an arrangement which led directly to the provision of services by the applicants. It was submitted by the respondents that whilst the provision of meals may have been in the contemplation of the parties the transaction which led directly to the provision of meals was in each case an order placed by a patron of the hotel with the applicants through the medium of the respondents' employees.

The provision of snacks to hotel patrons

22 It was the evidence of Mrs Noakes that she observed Mr Baggett preparing finger food on a Tuesday evening and was told by him that he prepared finger food each Tuesday and Friday night for a dart night which was conducted in the hotel. She was told by Mr Baggett that Mr Adams paid for the food and it was prepared by him without charge. Mrs Noakes said that she continued to provide these snacks on the same basis. Mr Adams paid the supplier of the items used for this food direct upon presentation of an invoice from the applicants.

23 On behalf of the applicants it was asserted that there was an arrangement whereby snacks would be provided by the applicants in the manner described and that Mr Adams was fully aware of this arrangement and concurred with it. It was said also that such an arrangement was inconsistent with the characterisation of the overall arrangement between the applicants and the respondents as being one confined to the lease of premises.

24 The respondents denied that there was any such compulsion on the part of the applicants and endeavoured to characterise what occurred as being a continuation of a practice which had been developed by Mr Baggett. This was obviously with the knowledge and concurrence of Mr Adams.

25 Before considering whether there is the necessary jurisdictional basis created by the proposed amended summons, it is appropriate to have regard to relevant authority. There are a number of decisions at appellate level which are of assistance in this regard.

26 For present purposes it is necessary to refer only to three recent appellate decisions. They are Solution 6 Holdings Limited v Industrial Relations Commission of New South Wales [2004] NSWCA 200 ("Solution 6"), Mitchforce v Industrial Relations Commission (2003) NSWCA 151 ("Mitchforce") and Mitchforce v Starkey (No 2) (2003) 130 IR 378. The first two authorities are judgments of the New South Wales Court of Appeal and the third a judgment of the Full Bench of this Court.

27 There are a number of observations which may be made in the context of determining whether the relevant jurisdictional basis may be attracted by reference to the several judgments in these cases. It is necessary to identify a contract (as defined in s 105) as being one "whereby work is performed in an industry". On the basis of authority the contract or arrangement must be one which leads directly to the employment of persons and the performance of work in an industry rather than the performance of work being "indirect or consequential". Indicia that this is so is that the contract must itself "directly envisage" the performance of work and the contract must have "a recognisable impact on the conditions of that employment" and "the work" (per Spigelman CJ in Solution 6 at paragraphs [53] and [55]). In this latter context the Chief Justice said:

"Although it is not an alternative test, I find it difficult to conceive of a contract, etc, which can be said to directly lead to the performance of work unless the contract, etc, both envisages the performance of work and has an impact upon the conditions of such performance. It may well be that these are minimum conditions for the conclusion of 'directness' to be drawn" (at [58]).

28 A commercial lease in standard form will rarely be a contract whereby a person performs work in an industry in the absence of any express term which obliges the lessee to conduct the business and even then such a term may not be determinative (per Spigelman CJ in Mitchforce at paragraph [53]).

29 "The distinction between it being the common intention of the parties that the respondents would operate a business from the leased premises (and thereby perform work), and the transaction directly leading to the performance of work, is a fine one, but an important one in the circumstances of the instant case" (per Wright J, President, and Walton J, Vice-President, in Mitchforce v Starkey (No2) at paragraph [142]).

30 It will be remembered that the applicants based their submissions in defence of the strike out application to a large part on the existence of an arrangement. That which constitutes an arrangement was discussed by Wright J, President and Walton J, Vice-President, in some detail in Mitchforce v Starkey (No 2). In paragraph [132] their Honours said:

"What may constitute an "arrangement" insofar as the section is concerned was discussed by the Full Bench in Legal & General Assurance Society Limited v Stock (1993) 49 IR 464 (at 480 - 481):

The authorities make clear that the term "arrangement" where used in the section is a wide one and encompasses transactions or plans which are not legally enforceable agreements. The following principles may be drawn from decided cases in the matter in relation to the ambit and reach of the term "arrangement" where used in the section (Unconscionable Contracts and Economic Duress - Peter M Hall, at 55-56):

(1) The word 'arrangement' in its ordinary meaning and particular statutory context is a word of much wider import than the word 'contract'.

(2) An 'arrangement' will be found to exist where there is a bilateral or multilateral plan or concerted action to bring about a particular result.

(3) An 'arrangement' may envisage a transaction in the nature of a bargain which may not be legally binding or enforceable, something in the nature of an understanding between two or more persons.

(4) The section speaks of an arrangement of a particular kind, namely, an arrangement whereby a person performs work in an industry, that is, a transaction which directly leads to the performance of work in an industry.

(5) The term 'arrangement' possessing a broad and extensive meaning may be found disclosed in a document comprising or specifying its terms, or there may be no document specifying the arrangement in which event resort will be had to oral evidence of discussions whilst in other cases an arrangement may be implied or inferred from the circumstances or the conduct of the parties. An arrangement may be discovered in a combination of documentary or verbal communications and the conduct of the parties. The relationship between the parties may itself manifest an arrangement.

(6) There may exist two separate contracts each forming part of a specific arrangement and together constituting the means by which it is effectuated so as to produce particular results and whereby a person performs work in an industry.

(7) The section accordingly comprehends not only the initial plans but all transactions by which the arrangement is carried into effect. It applies to any dealing the purpose or the effect of which is to achieve a situation as a consequence of which or wholly or partly in fulfilment of which a person performs work in an industry.

(8) The term 'arrangement' embraces a situation where there exists two or more separate contracts which, notwithstanding their separateness, are, in a particular factual context, so sufficiently associated with each other in a practical sense as together to constitute an arrangement of which each contract is a constituent part.

(9) The arrangement, including the relationship leading to the performance of work and another contract, need not necessarily have sprung into existence at the same time."

31 Later, their Honours said:

[135] "For an "arrangement" to be one whereby work is performed in an industry, there need merely be "a plan or concerted action by a number of persons to bring about [that] particular result": see Hall v Alison Clint Floral Delivery Pty Ltd at 64; and also Custom Credit Corporation Ltd v Goldsmith at 131, where the Full Bench held:

But it must be true to say, we think, that it is significant that Parliament did not see fit to include in the Act any definition of "arrangement", which is not a term of art and is not a word which has a very precise meaning. Looking at the setting in which it is used in s 88F, we are of the opinion that in one of its meanings "arrangement" embraces transactions which do not give rise to contracts or obligations, that is to say, obligations enforceable at law; but we are also of the opinion that in another meaning it embraces a situation where there exist two or more separate contacts which, notwithstanding their separateness, are, given the facts, so sufficiently associated with each other in a practical sense as together to constitute an arrangement of which each contract is a part.

[136] It is difficult to speak of an element of a "plan or concerted action by a number of persons" as being a "term" of such an arrangement in the manner with which that word was used by the majority in Production Spray Painting. Whilst such language was clearly appropriate in the circumstances of that matter, in the context of an arrangement, as we have described it, such a word is somewhat misplaced. We agree with the respondent that in such circumstances, a reference to "purpose" will clearly be of greater utility and directs attention to the substance of the transaction between the parties.

[137] What may constitute an arrangement against which the jurisdictional test (as earlier identified by us) is to be measured is clearly a matter of fact to be determined in all the circumstances.

[138] One thing, however, is certain and was emphasised by Mahoney JA in Majik Markets (at 455) "it is in principle necessary [to] know what the arrangement in question is so that [the Court] can determine whether the arrangement is one which falls within s 88F" (our emphasis). This is consistent with observations within the first Full Bench consideration of the section in In Re Becker & Harry M Miller Attractions Pty Limited (No.2) [1972] AR (NSW) 298, where it was stated at 304:

Merely reading the contract in vacuo supplies no answer on the issues both jurisdictional and discretionary which will face the single judge".

32 Production Spray Painting is a reference to Production Spray Painting & Panel Beating Pty Ltd v Newnham (1991) 37 IR 46 and Majik Markets is a reference to Majik Markets Pty Ltd v Brake & Service Centre Drummoyne (1991) 28 NSWLR 443 at 446.

33 For completeness I refer also to the judgment of Spigelman CJ in Solution 6 in which his Honour concludes that a 'contract' is not an 'arrangement' and, for the purposes of those proceedings, an enforceable contract could not be a 'collateral arrangement' (at paragraph [66]).

34 Finally, for the purpose of determining these proceedings I again refer to the well established line of authority in this Court concerning the circumstances and the basis upon which a determination should be made on an interlocutory basis that this Court lacks jurisdiction to deal with a matter. The authorities are referred to in the Full Bench decision in Euphoric Pty Limited v Ryledar Pty Limited and Anor [2002] NSWIRComm 136. The burden on the respondents in securing an order dismissing the summons for lack of jurisdiction is a heavy one. It has to be "plain that the invocation of the jurisdiction impugned is wholly misconceived, or upon analysis, lacks an arguable legal foundation" (see Kirby P (as his Honour then was) in the New South Wales Court of Appeal in Majik Markets).

35 As I previously indicated, the factual matrix against which this interlocutory application is to be considered is that contained within the proposed amended summons, taken at its highest in favour of the applicants. In compliance with the Rules of this Court (rule 18A) the summons by which the proceedings are constituted must specify in summary the matters of fact and law upon which the proceedings are based (but not the evidence by which those facts are to be proved). Accordingly, the matters of fact set out in the proposed amended summons are to be considered at their highest in favour of the applicants. The necessary cautious approach must take into account that matters of this kind should normally be determined once all of the relevant factual material has been adduced by way of evidence and subjected to forensic examination.

36 It is now necessary to review the matters which are relied upon by the applicants to support jurisdiction, and test them against the submissions made by the respondents in the context of the authorities to which I have referred.

37 In essence, in order to come within jurisdiction, the applicants need to establish the existence of a contract as defined, being a contract whereby a person performs work in an industry. By reference to the definition of contract this will include a contract, an arrangement, a related condition or a collateral arrangement. Each of these must satisfy the test of being one whereby work is performed in an industry (see Solution 6 and see also QSR Limited v Industrial Relations Commission of New South Wales [2004] NSWCA 199).

38 Taking the factual assertions contained within the proposed amended summons at their highest in favour of the applicants, I am of the opinion that they are capable of supporting an allegation that there is such an arrangement. The occupation of the café/restaurant premises by the applicants was governed by the general terms of the arrangement. This arrangement included the understanding that the applicants would prepare food as ordered from time to time by or on behalf of one or more of the respondents, who were in turn acting on behalf of the patrons of the hotel. The arrangement further included the fact that the applicants would supply snacks to the respondents, the details of which I have earlier set out. As has previously been observed there may be a fine line between a contract as defined, which satisfies the requirement of being one whereby work is performed in an industry, and a contract which falls outside the definition. The language which is used in the proposed amended summons to describe the factual matters upon which the proceedings are based has obviously been chosen with some care. However, for the purpose of these interlocutory proceedings it is not for the applicants to make out any of the facts which are alleged in the proposed amended summons. It is for the respondents to discharge the heavy burden of demonstrating that, in effect, there is no cause of action revealed by the facts as asserted. If one characterises the arrangement in the way I have set out above there are, in my opinion, facets of it which may satisfy the jurisdictional requirement, providing that they are ultimately made out. Put another way, I am unable to conclude that it could not be argued that, for example, the preparation of the snacks and the preparation of the counter food were not specifically required to be undertaken by the applicants at the request of the respondents.

39 I have deliberately focussed on two elements which, taken at their highest, may ultimately, if proven, satisfy the test required by s 106. This is because it is only necessary that there be an arrangement, part of the effect of which is to satisfy s 106, for the whole of the arrangement to be able to be dealt with within the s 106 proceedings. I proceed on the basis that there is support for this approach in the judgment of New South Wales Court of Appeal in Mayne Nickless Limited v Industrial Relations Commission of New South Wales [2004] NSWCA 359. On this basis it would not be appropriate to adopt the approach contended for by the respondents, namely that any part of any arrangement not able to be characterised as one whereby work is to be performed in an industry should in some way be excised from the proceedings. This would not, in my opinion, be an appropriate approach and would create more forensic difficulties than it might otherwise solve. In addition, as I have said, it would not seem to be a permissible approach consistent with authority.

40 Lest, however, the applicants seek to gain some comfort from this approach, they should steadily bear in mind what was said by the Chief Justice in Solution 6, namely that "once jurisdiction is established, I have no doubt that the Commission can void or vary any aspect of a contract or arrangement which is closely related to the performance of work..."(at paragraph [73]). "In my opinion, the power of the Commission to declare void or to vary a contract or arrangement does not extend to a provision which has no relationship whatsoever to the performance of work..." (at paragraph [95]). These observations were cited with apparent approval by Mason P in Mayne Nickless, with whom Hodgson and McColl JJA agreed.

41 For the reasons set out above, this basis for the respondents' notice of motion is refused and to that extent the motion should be dismissed.

42 The respondents also relied upon another argument based on the judgment of the New South Wales Court of Appeal in Sydney Water Corporation v Industrial Relations Commission of New South Wales [2004] NSWCA 436. The principal judgment in those proceedings was that of Mason P with whose reasons for judgment Hodgson and McColl JJA agreed. The judgment in Sydney Water emphasises that in determining whether a contract is unfair one has to have regard to the provisions of the contract, whether either by way of those which are contained within its terms or by reference to those which have been omitted and are not dealt with. His Honour emphasised that it is impermissible to find that a contract is unfair "based on no more than conduct in breach of contract, ie even if it attracts an appropriate and presumably adequate remedy under the general law..." (at paragraph [44]). It was submitted by the respondents in these proceedings that the proposed amended summons was so confined in the allegations relating to unfairness that it fell within the impermissible boundaries established by Sydney Water. In my opinion such a submission cannot be sustained. This is particularly so in the context of an arrangement, the provisions of which have not been established with any certainty. In addition, many of the bases for the alleged unfairness rely on representations which the applicants said were made to them by the respondents, inducing them to acquire the business and operate it. Also, the specific allegations of unfairness in their terms fall outside the strictures established by Sydney Water. I instance an allegation of unfairness created by the absence of a secure tenure by way of lease, the absence of any right to sell alcohol in the manner originally represented, the failure of the respondents to construct a new bistro area and the like. In my opinion the respondents have failed to make out any such case on an interlocutory basis and this aspect of the notice of motion must fail also.

43 I should emphasise that there are other interlocutory proceedings between the parties which, by arrangement, I have not dealt with. Any of these matters may be restored to the list for hearing by either party upon application being made to my Associate. It would be advantageous if the legal practitioners could reach some consensus on what further steps should now be taken to resolve all outstanding interlocutory matters and advise my Associate accordingly.

44 I make the following orders:

1. The respondents' notice of motion seeking to preclude the applicants from filing a proposed further amended summons is dismissed.

2. Costs are reserved and I grant liberty to apply with respect to costs.

3. Liberty to apply generally.

LAST UPDATED: 14/03/2005